Blockchain forces a breakthrough in developing countries
The extravagant billionaire Richard Branson is confident that blockchain could bring a true “economic revolution” in many developing countries. But is the distributed ledger technology a panacea indeed or is it just words?
Facing the challenges
Financial exclusion is an acute problem, especially in developing nations. The World Bank estimated that 1.7 billion adults from pole to pole remain unbanked. Being cut from banking services, they can’t take credits, keep savings, send and receive international payments. Yet, 1.3 billion people with accounts in the third world countries pay their public utility bills in cash rather than use banking instruments.
One more major issue is too costly international money transfers. The citizens of the less developed countries often go to richer regions to work there and earn money for families at home. For sending it, they use various remittance services such as Western Union or MoneyGram. The problem is that these intermediary platforms collect huge (up to 10%) charges and fees. As a result, migrant workers lose money earned for their loved ones.
Breakthrough technologies to the rescue
When traditional solutions don’t work anymore, innovations such as blockchain come to save the day. It literally brings financial services to everyone, regardless of income or location. Every unbanked person can create a cryptocurrency wallet and obtain an excellent opportunity to receive and send money in a more convenient, more reliable and faster way.
Since mobile communication has a much better market penetration in the developing countries, the citizens will find it easy to download a crypto wallet to manage their digital assets. In addition, there is no need to deal with banks and other financial institutions, which drastically reduces cross-border payment fees.
This feature successfully copes with the second issue, i.e. expensive remittance payments. Sending earnings to their families through the blockchain-based platforms, the migrant workers can save a significant part of their money.
Just imagine that Overseas Filipino Workers (OFWs) will pay $3.1 billion worth of bank fees when they send home $29.3 billion this year! A guest Filipino worker loses an average of $10.57 worth of bank fees for every $100 remitted home. Cutting remittance charges by half would leave $1.5 billion in OFWs’ pockets and their beloved ones.
Blockchain in action
Seeing the incredible opportunities innovations can bring to the world, some entrepreneurs have already worked out their solutions. For example, the blockchain-based remittance system BitPesa launched in 2014 allows people to convert their virtual money into the local currency and transfer it to their mobile accounts. In the first few years of operation, BitPesa enabled over 6,000 users in Kenya, Nigeria, Tanzania and Uganda to make cross-border payments and run their businesses.
In Latin America, a financial payments company Ripio helps users process international transactions with bitcoins or credit cards using blockchain technology. Customers can buy bitcoins instantly with cash in Brazil, Argentina, Ecuador and Chile.
The Asian experts could not stand aside and brought their ideas to the table, too. The Japanese Noah Project is currently working on several ambitious large-scale solutions aimed at benefiting the developing regions and making smart tools closer to people.
The Noah Project will initially operate in the Philippines. It is a developing country with 2.3 million OFWs according to the Philippine Statistics Authority’s data. Their money transfers make up 10% of the country’s GDP. To deliver OFWs from the necessity of paying huge bank charges, the project team has developed a powerful remittance system driven by blockchain and Noah Coin, the internal project token. Thanks to the Noah solution, the remittance fees will drop to 2–3%.
For the users’ convenience, the team has created a user-friendly and intuitive Noah Wallet that can be freely downloaded from App Store and Google Play. The wallet will allow the token holders to store, send, and receive Noah Coins and other cryptocurrencies such as Bitcoin and Ether.
The Noah Project is now building the future largest crypto hub called Noah City and one-of-its-kind crypto paradise known as Noah Resort. The team hopes that these places will attract new tourists, traders, businessmen, and people who want to expand their experience in dealing with cutting-edge instruments and digital funds. Noah Coin and other cryptos will obviously be accepted there.
The token is now available on six reliable and well-known crypto exchanges (HitBTC, Changelly, BTC-Alpha, Mercatox, LiveCoin, and YoBit). Transacting with Noah Coins, the customers will get various discounts as well as bonuses and will be able to participate in special loyalty programs.